Berger, Johannes; Herbertz, Claus; Sliwka, Dirk - Institute for the Study of Labor (IZA) - 2011
theoretically show that favoritism leads to a lower quality of promotion decisions and in turn lower efforts. But the effect can be … mitigated by pay-for-performance incentives for managers who decide upon promotion. Second, we analyze matched employer-employee … survey data with detailed firm level information on managerial incentive schemes and find that perceived promotion quality is …